Pushing Up House Prices

The housing advice association Shelter has argued that Help to Buy has contributed to increasing house prices. Under the programme, those borrowing were able to secure a mortgage with a deposit of just 5% and if borrowers were unable to honour their mortgage payments, the government compensated the lender. It is unclear how much money the Treasury will ultimately have had to pay out on Help to Buy as there could be an increase in mortgage defaults when interest rates rise. However, so far just £17,000 has been spent on compensation. The final figure will be calculated at the end of June 2024.